REVENUE AND RESULT

The Group's revenue amounted to SEK 1,114.5 (735.8) million. The profit before tax was SEK 156.3 (11.4) million. The result for the previous year included capital gains on the sale of ships amounting to SEK 57.3 million. In 1997, there were no sales.

The freight market developed favourably in 1997. In December, however, the market freight rates fell sharply. Despite this, our profit was 98% of the SEK 160 million forecast given on 23-10-1997.

LIQUIDITY AND FINANCING

The Group's disposable liquid funds, including unutilised credit facilities, amounted to SEK 196.2 million (146.9) on 31-12-1997. About 50% of the vessels' cash flow is blocked in order to secure repayment of the Group's Private Placement loan of USD 110 million, equivalent to SEK 865 million in 1999. When the Group's disposable liquid funds amount to USD 25 million, equivalent to SEK 197 million, about 75% of the vessels' cash flow will be blocked. This level was reached for the first time during the autumn of 1997. At year-end, USD 50 million, equivalent to SEK 394 million was blocked.

INTERCOMPANY TRANSACTIONS

A company in the Stena Sphere participated in the financing of the acquisition of Universe Tankships in 1996 by granting an interest-free loan of USD 22 million. This loan was redeemed in full in 1997 following a final payment of USD 2 million.

TOTAL ASSETS

Total assets increased from SEK 1,574.9 million to SEK 1,932.5 million mainly as a result of a higher USD exchange rate. The USD exchange rate was 7.87 on 31-12-1997 (6.87).

NET WORTH

The fleet was appraised as of 31-12-1997 by four independent shipbrokers. The fleet's average value according to these appraisals was USD 231.8 (241.3) million, equivalent to SEK 1,824 million (1,658).
Net worth per share before deferred tax is calculated at SEK 46.37 (35.48) on the basis of these appraisals. The corresponding worth after full conversion is calculated at SEK 30.64 (23.73).

The consolidated equity ratio on 31-12-1997 was 32% (23) and the adjusted equity ratio, i.e. including the estimated surplus values in the fleet, was 48% (42). The return on equity increased to 32% (4).

FREIGHT MARKET 1997 - SHIP REVENUE

The first quarter of the year began with relatively low freight rates at just over break-even point for Concordia's VLCCs. During the summer months, the freight rates began to rise and culminated in October and November at a level of USD 35,000 per day for our VLCCs and USD 50,000 per day for our ULCCs. In December, the freight rate for VLCCs fell to USD 15,000 per day.
The average freight rate for Concordia's VLCCs was USD 26,300 (19,600) per day while the estimated market freight rate, according to Platou Ec. Research, was USD 23,400 (15,900) per day.

FREIGHT MARKET 1998 - PREREQUISITES

In 1997, 14 large tankers were scrapped or converted for the offshore industry while 9 were delivered. Contracts for 40 VLCCs were signed during the year. At year-end, 71 large tankers were on order, 14 of which are expected to be delivered in 1998.
In 1998 too we expect shortages for vessels to lead to periods which could produce freight rates at the same level as in 1997.

After the decline in December, 1997, the market began to rise again and so far this year, the freight rate for VLCCs has been USD 26,000 per day. Freight rates at the beginning of 1998 have thus been better than at the beginning of 1997. The break-even point for Concordia's VLCCs is USD 20,000 per day.

The profit for the first two months of 1998 is estimated at about SEK 20 million which can be compared with a profit of SEK 8.7 million for the first three months of 1997.

TECHNICAL MANAGEMENT AND OPERATION

Concordia's vessels continue to operate very satisfactorily, both technically and operationally. As a result, they are regularly requested by our customers for transportation in demanding regions such as the North Atlantic and West Africa. Today, Concordia and Stena Bulk have 24% of the VLCC market from West Africa to the US and Europe.

Since there were no dry-dockings in 1997, Concordia was able to derive the maximum benefit from the upswing in freight rates. In 1998, one ULCC, three VLCCs and the bulk carrier CONVEYOR will be dry-docked according to plan. Their CAP certificates - quality assessment - will be renewed in conjunction with these dry-dockings.

Our oldest vessel, the STENA CONVOY, completed a number of voyages loaded in accordance with the Safe Loading System (SLS) which is required if ships between 25 and 30 years old are to be permitted to transport oil. This requirement can be met either by loading with hydrostatic balance (HBL), the alternative chosen by Concordia, or by conversion to segregated ballast tanks (SBT).

Loading according to the HBL method means that the water pressure beneath the ship's bottom is greater than the pressure of the oil in the tanks, thus preventing any leakage of oil in the event of a grounding. The principle is called Hydrostatically Balanced Loading (HBL). In the case of the STENA CONVOY, the reduction in cargo capacity was about 4%.

MARINE SAFETY RATING SYSTEM
- A FURTHER QUALITY BOOST FOR CONCORDIA

Concordia, which has long been a strong supporter of higher quality and safety in shipping, has begun MSRS classification. MSRS stands for Marine Safety Rating System which is an enhancement of the ISO 9002 system and measures the Company's safety development. MSRS requires the Company to continuously improve its safety work on board and ashore. For Concordia, which has older, well-maintained tonnage, there is also a competitive advantage in always taking the lead and continuously raising its requirements as regards quality, safety and environmental protection.

DIVIDEND

The Board of Directors will propose to the Annual General Meeting that a dividend of SEK 1 per share be paid.

ANNUAL GENERAL MEETING

The Annual General Meeting with shareholders will be held in Bankettsalen, Radisson SAS Park Avenue Hotel in Gothenburg on 20 April, 1998, at 2.00 p.m.

The Annual Report for 1997 will be sent to all registered shareholders and holders of convertibles at the beginning of April.

The Interim Report for the first three months of 1998 will be issued in conjunction with the Annual General Meeting on 20 April. The Interim Report for the first six months of 1998 will be published on 20 August, and the 9-month Report on 21 October

CONCORDIA MARITIME AB

Lars Carlsson, President

Further information may be obtained from Lars Carlsson, President (tel +46 31-85 50 03 and 0705 85 51 01) or Jan-Erik Hammer, Financial Manager (tel +46 31-85 50 46 or 0704 85 50 46).